Bitcoin Sellers Emerge Amid Profit-Taking, $80K in Focus
Key Summary
Bitcoin holders in profit, but buyers nowhere to be found as profit-taking and weakening market conviction raise downside risks, with the $80k support level facing pressure from short-term holders and dormant wallets becoming active again, potentially leading to further price declines.
Analysis of Bitcoin's Current State
Bitcoin's $80k support faces pressure as profit-taking and weakening market conviction raise downside risks.
Technically, BTC has been consolidating above $80k for over three weeks now, but the price action still lacks the strength needed to confirm a bottom.
Key Findings
About 86% of Bitcoin deposited into exchanges in early October came from short-term holders in profit.
This implies that some recent buyers are ready to take profits. Bitcoin's short-term price movements are mainly dictated by how much supply enters the market. If sell-offs outpace demand, healthy profit-taking may turn into a stronger selling pressure.
Impact on Market
The result? Bitcoin closed the first week of October down more than 3%, with its lower wick constantly probing the $80k zone over the past two weeks.
A breakdown below this level could put $75k in focus next, especially if short-term holders take profits at the first sign of weakness.
Long-Term Holders
Apart from liquidity, Gorjan Kolev also cites scarcity in tracking BTC’s next move.
If LTHs continue to HODL while the STHs sell, the available supply could remain tight. However, if the selling pressure spreads to LTHs, the market could face a deeper correction.
Dormant Wallets
According to Lookonchain data, another OG Bitcoin wallet has been reactivated after years of inactivity and moved 4,582 BTC, or worth about $377.58 million.
This follows last week’s activity from another whale wallet, which moved 4,500 BTC worth $375.72 million from the account after being inactive for over four years.
Conclusion
As the chart below shows, Bitcoin’s LTH SOPR has crossed above its yearly average of 1.10, and now stands at 1.25 on a weekly basis and 1.16 on a monthly basis.
So, LTHs are back to profit territory. With dormant wallets active again, the potential for profit-taking and additional selling pressure is now worth watching.
Image Prompt
A photo of a cryptocurrency trader looking at a screen with a concerned expression, with a faint image of the Bitcoin price chart in the background.